Agency; Agent; Good Faith

Agency; Agent; Good Faith

Explain the agent must act in good faith


Let's first define the terms for other visitors.

An "agent" is someone who acts on behalf of or represents another person called the "principal". The principal appoints or designates another to act as his or her agent. That designation can be accomplished in a number of different legal documents and for a myriad of purposes. The relationship can be created verbally, although there are limitations. The courts may even infer in certain circumstances that an agency relationship exists even when the parties involved did not formally create one (e.g., implied contract). In some instances the relationship of principal and agent is referred to as "master" and "servant". An example would be an employer for whom an employee serves as an agent. An agency relationship is a "fiduciary" relationship, a position of trust.

Now let's take a look at part two of your question, "Good Faith".

"Good faith" is an honest effort, with honest intentions, without any intent to defraud. If your agent is acting in good faith he or she should be conscientious in carrying out the duties of agent, in accordance with the appointment as agent. An agent that acts in good faith must behave in a manner that is faithful to his or her responsibilities to you as agent.

If you consider the myriad of different types of agents and manners in which an agent can be appointed great care must be taken in determining what constitutes "good faith" as it will vary depending on the terms of the appointment (was there a contract appointing the agent and if so what did it say), the circumstances (especially if its an implied agency), and the nature of the actions (the property the agent has to deal with, etc.), and finally what the state law that applies to the agency relationship provides for. This latter issue may be quite complex if different states are involved. So if its a simple power of attorney start by reading the document. You'll need a lawyer to sort all this out for you. It may not be straightforward.

Our Consumer Webcasts and Blogs

Subscribe to our email list to receive information on consumer webcasts and blogs, for practical legal information in simple English, delivered to your inbox. For more professional driven information, please visit Shenkman Law to subscribe.

Ad Space